Taiwan and Beijing Sign Historic Trade Deal, ECFA

Taiwan and mainland China signed their most significant trade deal in 60 years on Tuesday. The Economic Cooperation Framework Agreement—or ECFA—slashes tariffs on more than 800 goods. It’s expected to increase two-way trade by $100 billion a year.

Huang Ching-hsun is Chairman of the Taiwan Business Association in the Chinese city of Chongqing, where the deal was signed. Huang says the trade pact will benefit cross-strait ties and business in Taiwan.

[Huang Ching-hsun, Chairman, Taiwan Business Association in Chongqing]:
„In terms of the future, this will be the best step in expanding the relations between the two sides of the Taiwan Strait. It’s wrong to say that it would only be of benefit to trade. People ask me whether my project is included in the deal, but I think it’s wrong to think in such narrow terms, because most products involves more than just one industry.“

Under the deal, there will be tariff cuts on Chinese exports worth almost $3 billion, and Taiwan exports totaling nearly $14 billion. But there’s a lot of opposition. Over the weekend, Taiwan’s Democratic Progressive Party organized a massive protest. They argue the deal will cause unemployment and flood Taiwan with cheap Chinese-made products—harming Taiwan’s economy.

David Zweig is the director of the Center on China’s Transnational Relations at the Hong Kong University of Science and Technology. He believes the Chinese regime’s push for the trade agreement may be motivated by politics—not just economics. He says they want to use the agreement to win the trust of the Taiwan people.

[David Zweig, Hong Kong University of Science and Technology]:
„They recognize politically the people of Taiwan still generally mistrust the Communist Party and the way that they can win over their hearts and be able to move deeper into deeper integration between Taiwan and the mainland is through economic cooperation.“

The Chinese regime perceives Taiwan to be a breakaway province and not a separate country. The Nationalist Party retreated to Taiwan in 1949 after the civil war, while the Chinese Communist Party claimed rule over the mainland.

There had been very little economic cooperation until this past decade. This trade deal signed on Tuesday may be just their first step to furthering economic ties. The next round of talks could start as soon as December.

Foto: NTDTV